MGX Minerals Begins Operational Testing on the Li-1 Lithium Recovery Unit, Producing Lithium from Oil and Gas Brine Water
LOS ANGELES, CA / ACCESSWIRE / August 1, 2017 / In the race to meet surging lithium demands, innovation is happening from a seemingly unlikely source: the oil patch.
Commercial production of lithium from petroleum-derived brine water took a major step towards reality, as operational testing commenced on the first petrolithium pilot plant today.
Petrolithium involves the patent pending rapid recovery method of producing commercially viable lithium from produced water from petroleum wells and other lithium-rich brines.
The project is being spearheaded by MGX Minerals (CSE: XMG) (OTC PINK: MGXMF) (Frankfurt: 1MG), whose Li-1 lithium recovery unit commenced operational testing at its pilot plant.
Along the process, the pilot plant separates impurities from oil and gas wastewater, further allowing for extraction of lithium and magnesium, and the ability to reuse and repurpose industrial water and brine.
Currently capable of processing 20 m3/day, the Li-1 pilot plant is scheduled for expansion to increase throughput to 100m3/day - which is half the capacity of planned commercial-scale systems scheduled to be shipped to sites in the US and Canada in Q1 of 2018.
Fabrication of a commercial-scale system capable of processing 200m3/day is already underway, and expected for deployment in Q4 2017.
Samples of lithium-rich brines for the pilot plant were obtained from MGX lithium and petrolithium properties, as well as from regional oil and gas partners.
The testing currently underway will help MGX to finalize its technical specifications for contractual arrangements with both industrial and oil and gas partners.
THE PETROLITHIUM EFFECT
While the global lithium market scrambles to meet the meteoric rise in lithium demand, current lithium extraction methods using large solar pools remain a very slow evaporation process to produce commercial lithium - taking several months, and even up to a couple years.
Through the rapid lithium extraction MGX is employing through the technology used in LI-1, production can be reduced to mere hours.
What's even more impressive is the capacity that MGX President and CEO Jared Lazerson envisions for his company in the near future.
Using the same physical and operational templates to move from bench scale to the field, MGX believes it has the ability to morph the Li-1 system into large commercial systems capable of producing more than 1500m3/day (or 1.5 million litres per day).
Given that MGX has successfully amassed a land package of over 2 million acres in lithium brine mineral claims, the company appears to have solidly backstopped itself with a seemingly endless supply of brine to produce from.
Through multiple rounds of testing and development already, MGX and its partners have succeeded in significantly upgrading lithium concentrations from their brines, and removed impurities to produce a clean lithium product.
At concentrations of 50mg/L, and the capability of processing a million and a half liters per day would potentially produce upwards of 180 tons of lithium carbonate per year. At the modern pricing of $10,000 per tonne, the potential from one plant would be revenues of close to $1.8 million per year.
At concentrations of 100mg/L Li, there is approximately $3.6 million in lithium carbonate equivalent.
Given that there is only an additional 35,000 tons of lithium carbonate supply expected to be brought online this year, a possible injection of 21,000 tons per year someday coming from MGX's operations could be quite significant.
THE OIL PATCH EFFECT
Also, key to MGX's announcement was the mention of potential oil and gas partners. This is not new, as MGX has already previously announced a relationship with a major oil and gas operator, however the potential for Li-1's technology to serve as a water management service in the oil patch is very enticing as an opportunity.
Mobile units, and dispatching plants to operations with large amounts of lithium-rich brine production enhances MGX's potential to be a complete game changer for both the oil and gas sector AND the lithium sector.
Water management is big business in the oil patch, as water production hinders the profitability of wells across North America. Producers are paying upwards of $100 per truck per hour to haul water, which can significantly eat into the profitability of a well.
If MGX can offer a reasonable price on water treatment, while deriving value from the minerals embedded in the brines, both parties can come out significantly ahead. Proving that water can become an asset, instead of just a headache and cost, MGX's reputation as a problem solver will rise rapidly across the sector.
Either way, expect the progress of petrolithium to gain more and more attention as MGX moves forward with its pilot plant, and its commercial-scale rollout in the coming months. So far the company has met its targets, and continues to make significant leaps and bounds in progress as it gets closer to its goals of changing the lithium market as we know it.
Joel Chury for StockSocial.com
Disclaimer: Opinions and forward looking statements expressed in this article are that of the author only and should not be taken as investment advice. A fee was paid for this report. Investors should always consult an investment advisor before making any trading decisions.
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